DuPont Decomposition
Why does KAKATCEM earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
-6.4% = -14.9% × 0.35 × 1.21
Latest: FY2025
Profitability
Net Margin
-14.9%
-2.9% →-14.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.35x
0.45x →0.35x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.21x
1.51x →1.21x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 4.4 pp over 3 years. Driven by net margin declining (-2.9% → -14.9%), asset turnover declining (0.45x → 0.35x), leverage falling (1.51x → 1.21x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹-0Cr | -2.9% | 0.45 | 1.51 | -1.9% |
| FY2024 | ₹0Cr | ₹-0Cr | -0.9% | 0.44 | 1.56 | -0.6% |
| FY2025 | ₹0Cr | ₹-0Cr | -14.9% | 0.35 | 1.21 | -6.4% |
How to read DuPont
- • Rising ROE from margin = pricing power, operational improvement (good)
- • Rising ROE from turnover = better asset utilization (good)
- • Rising ROE from leverage = more debt, amplified risk (caution)
- • Falling ROE across all three = structural deterioration (red flag)
DuPont decomposition from audited annual financials. Factual analysis, not investment advice.